European IR Benchmarking Wo ist der deutsche Mittelstand? Amani Korayeim Director EMEA Sales and Product Development Institutional Investor Research
11/07/2017
• Background II • Research Methodology • Analysis
o Buy-Side o Sell-Side
• Best Practice • Key take-outs
Agenda
BACKGROUND
• 40 years survey-based rankings and analysis Annual studies of global equities and fixed income markets provide access to leading
investment professionals across the world, accompanied by in depth articles and insight in II
Magazine
o Research Europe o Sales Japan o Trading Asia o Investor Relations LatAm o Hedge Funds U.S.
Institutional Investor Research
Research Methodology 2016
Research Methodology: Triangular Approach
Buy-Side Investors
Corporates
Sell-Side Analysts
• 817 sell-side analysts • 139 firms
→ nominating 1,015 COs → across 31 sectors
• 1,245 buy-siders and PMs • 668 firms
→ nominating 938 COs → across 31 sectors
547 IROs and CFOs giving insight on best practice in investor engagement
Buy-Side Voter Universe
Sell-Side Voter Universe
• Global Voter Universe • Confidential and anonymous • No weighting on AuM • No vote swapping • Unprompted – ‘write-in ballot’
Research Methodology: Key Differentiators
Research Methodology – Write-in Ballot
Research Methodology – 6 Performance Metrics
The Analysis
Football is a simple game; 22 men chase a ball for 90 minutes and at
the end, the Germans win.
—•Gary Lineker[1]
What Buy- and Sell-siders want?
SS 2017 Rating
BS 2017 Rating
0123456789
The companyprovides a timelyand appropriatelevel of financial
disclosure
Senior executivesare accessible
The IR team is wellinformed and
empowered tospeak
authoritatively onthe company's
behalf
Quality ofcorporate
documents andinvestor kitmaterials
The companyresponds quickly
and thoroughly torequests
Hosting the mostconstructive
conference calls
8.35 8.18 7.89 7.72 7.28 7.15
8.39 8.09 7.25 7.35
6.95 6.83
SS 2017 Rating BS 2017 Rating
Overall Ranks and Analysis – IR Programme
1
2
3
4
5
29.13%
25.30%
18.90%
16.33%
10.34%
5
3
4
2
1
12.59%
19.67%
12.90%
25.72%
29.12%
- 10 20 30 40 50 60
United Kingdom
Germany
France
Spain
Italy
BS Rank SS Rank
BS/SS – Financial Disclosure & Transparency
1
2
3
4
5
36.16%
20.94%
17.33%
16.85%
8.72%
4
3
5
2
1
15.99%
17.94%
12.40%
22.68%
31.00%
- 10 20 30 40 50 60 70
United Kingdom
Germany
France
Spain
Italy
BS Rank BS Score SS Rank SS Score
BS/SS- Access to Senior Management
1
2
4
3
5
26.35%
21.42%
19.75%
19.86%
12.62%
4
3
5
2
1
15.83%
17.69%
13.12%
22.97%
30.39%
- 10 20 30 40 50 60
United Kingdom
Germany
France
Spain
Italy
BS Rank BS Score SS Rank SS Score
BS/SS: Credible and authoritative IR Team
2
1
3
4
5
25.48%
28.47%
23.40%
13.26%
9.39%
5
3
4
1
2
9.39%
23.40%
13.26%
28.47%
25.48%
- 10 20 30 40 50 60
United Kingdom
Germany
France
Spain
Italy
BS Rank BS Score SS Rank SS Score
1
2
3
4
5
34.04%
25.44%
17.26%
14.39%
8.87%
4
3
5
2
1
14.64%
20.23%
11.84%
22.86%
8.87%
- 10 20 30 40 50 60
United Kingdom
Germany
France
Spain
Italy
BS Rank BS Score SS Rank SS Score
Quality of Corporate Documents
2
1
4
3
5
23.49%
30.12%
17.18%
17.37%
11.84%
4
3
5
1
2
13.83%
21.58%
13.22%
26.90%
24.47%
- 10 20 30 40 50 60
United Kingdom
Germany
France
Spain
Italy
BS Rank BS Score SS Rank SS Score
BS/SS Responsiveness of IR Team
Filling in the blanks…Best Practice
5%
19%
26%
17%
33%
13%
25% 25%
13%
25%
-% -%
43%
14%
43%
%5%
10%15%20%25%30%35%40%45%
Less than 1year
1-3 years 4-7 years 8-10 years More than 10years
All Respondents UK companies German Companies
IR Experience & Professional Background
43% of German companies have more than 10 years experience
Average number in IR Team is 3 – German IR Teams have 4
35%
26%
14%
10%
8%
4%
3%
38%
50%
-%
-%
13%
-%
-%
38%
38%
25%
-%
-%
-%
-%
-% 10% 20% 30% 40% 50% 60%
Finance
Sell Side
Comms/Marketing/PR
Strategic Planning & Ops
Buy Side
Other
German Companies UK companies All Respondents
IR Programme activities
83%
36% 36%
9%
80%
100%
40%
80%
100%
57%
43%
14%
0%
20%
40%
60%
80%
100%
120%
Shareholder ID Investor/analyst perceptionresearch
Invesestor targeting Road Show Management
All respondents UK Companies German Companies
The Buy-Side
Buy-Side: Allocation of Time
39% 37%
16%
5% 3%
33%
38%
23%
5% 2%
44% 43%
9%
2% 2%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Buy-side analysts andportfolio managers
(excluding hedge funds)
Sell-side analysts Hedge fund managersand analysts
Retail investors Other
All Respondents UK Companies German Companies
31%
23% 22%
16%
9%
50%
25% 25%
57%
14% 14% 14%
0%
10%
20%
30%
40%
50%
60%
Annually Every other year Only when we haveimportant changes in
strategy or otherinitiatives
We don’t host analyst/investor days
More than once a year
All Respondents UK companies German Companies
Hosting of Analyst days
74%
51% 46%
38%
16% 16%
7%
75%
13%
50%
88%
13% 13%
0%
43% 43%
71%
43%
29%
0% 0% 0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Introductions madeby sell-side firm
Investor Days Updates/changes incompany strategy
Industry conferencesnot sponsored by my
company or a sell-side firms
Expansion into newregions
Marketing andpublic relations
Industry conferencessponsored by my
company
All Respondents UK Companies German Companies
Channels of attracting new investors
20
102
53
16
37
0
20
40
60
80
100
120
Germany France Italy Spain UK
No. of new investor targeted over 12 months
Buy-Side : Effective Communication
67%
49% 44%
38%
26% 24% 19% 17%
12%
75%
63%
25% 25%
13%
63%
25%
13%
57%
71%
43%
29%
14%
43%
29%
14%
0% 0%
10%20%30%40%50%60%70%80%
All Respondents UK Companies German Companies
Buy-side: Effective Interaction
How often does the company's executive team initiate contact with the buy side?
Change in executive team's interaction with the buy side
24%
32% 31%
14% 14%
43% 43%
-%
43%
57%
-% -% %
10%
20%
30%
40%
50%
60%
At least once aweek
At least once amonth
At least once aquarter
At least twice ayear
All respondents UK Companies German Companies
68%
29%
2%
71%
29%
-%
86%
14%
-% -%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Our level of interactionis about the same as it
was a year ago
We reach out to thebuy-side morefrequently now
We reach out to thebuy-side less frequently
now
All respondents UK Companies German Companies
Buy-side: Effective Interaction
One-on-one meetings with analysts or portfolio managers Events sponsored by a sell-side firmTotal UK 234 90Total German 328 71CEO UK 124 30CEO German 63 39CFO UK 110 40CFO Germany 232 28
234
90
328
71
124
30
63 39
110
40
232
28
0
50
100
150
200
250
300
350
Total UK Total German CEO UK CEO German CFO UK CFO Germany
Quantity of meetings with Executive Management
The Sell-Side
Sell-side: Effective Research
An average of 24 sell-side analysts cover German companies versus
19 in other European countries
Change in published research by brokerage firms
57%
14%
29% 25%
50%
25%
43%
29% 29%
-%
10%
20%
30%
40%
50%
60%
Increased Decreased It has not changed
Spanish Companies UK Companies German Companies
German Companies read an average of 16 analysts research
consistently versus 14 in other European countries
100%
71%
43%
29%
43%
14%
88%
50%
63%
38%
63%
0%
86% 86%
43%
0%
14% 14%
0%
20%
40%
60%
80%
100%
120%
Earnings calls and Q&A Personal contact byphone or email
Company publications(financial
announcements,annual reports, etc.)
One-on-one meetings Group analyst briefingsand site visits
Nondeal road shows
Spanish Companies UK Companies German Companies
Sell-side: Effective Interaction
Change in executive team interaction with the sell side
33%
50%
17%
88%
13%
-%
86%
14%
-% -%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Our level ofinteraction is aboutthe same as it was a
year ago
We reach out to thesell-side more
frequently now
We reach out to thesell-side less
frequently now
Spanish Companies UK Companies German Companies
Sell-Side: Effective Interaction
How often does your executive team initiate contact with the sell side?
69%
19%
10%
2%
50%
13%
25%
13%
57%
29%
14%
-% 0%
10%
20%
30%
40%
50%
60%
70%
80%
At least once aweek
At least once amonth
At least once aquarter
At least twice ayear
Spanish Companies UK Companies German Companies
• Fresh blood
• Stay close to investors
• More active road show management, with broker and
independently
• Regular workshop based analyst/investor days
• Relevant industry conferences to attract more new investors
• Increase sell-side interaction with one-on-one meetings
Key take outs
Thank you for your time